Frustrated by personal attacks and the "nonsense" that often permeate politics, the pretty former Miss Toronto (1964) B.C. Minister of Finance announced on November 30, 2007 that she will not seek re-election in 2009. Married to former Vancouver mayor Art Phillips, her future career remains unclear at this time.

B.C. Finance Minister Carole Taylor announced her last budget on February 19, 2008. The main theme of her budget focused on environmental issues, hence known as the “green” budget. The following are the highlights:

Beginning July 1, 2008, there will be a new revenue neutral carbon tax on all fossil fuels (gasoline, diesel, coal, propane, natural gas, and home heating fuel) in B.C. This tax will be collected at the wholesale level. The intent is to use a higher cost to reduce emission of green house gas by discouraging use of fuels and to promote cleaner options. Revenue generated by this tax will be used to reduce income and business taxes. The provincial government will be required to table a plan to ensure that this new tax is revenue neutral annually.

To help offset the cost of the new carbon tax, lower income households will receive a new Climate Action Credit of $100 per adult and $30 per child per year, paid quarterly with the Goods and Services Tax Credit. Furthermore, every British Columbian will receive a $100 Climate Action Dividend this June, before the carbon tax takes effect.

Effective July 1st, 2008, the general corporate income tax rate and the small business tax rate will be reduced to 11% (from 12%) and to 3.5% respectively. By 2011, corporate income tax rate and the small business rate are expected to drop to 10% and 2.5% respectively.

Insulation of hot water tanks, pipes and duct work and purchases of Energy Star-rated fridges, freezers and washing machines will be exempt from PST.

Effective March 1, 2008, the threshold of the First Time Home Buyers program (exemption from property transfer tax) was raised from $375,000 to $425,000 and previous financing rules and regulations had been eliminated.

Effective for the 2008 tax year, the threshold assessed value for the phase out of home owner grant will be increased from $950,000 to $1,050,000. Grants to properties above this threshold will be reduced by $5 for every $1,000 over the threshold and will be completely phased out when the assessed value is above $1,219,000.

Remarks

As long as the need and the convenience of driving remain unchanged, the effectiveness of the carbon tax in reducing greenhouse gas is doubtful. Most British Columbians will not drive less or not heating up their homes because of the extra $45 and $113 carbon tax in 2008 and 2009, especially when some of them receive the Climate Action Credit to mitigate the extra cost. Despite its revenue neutral status, the administration costs of the new tax will likely become a deadweight loss taxpayers have to bear. Other than a higher price, consumers will not see a separate tax item on their gas bills. This new carbon tax is a politically astute move as some British Columbians will be pleased by the Climate Action Credit and the logic of the tax to combat global warming may appear sound to some people.

To discourage use of fuel, it will be more effective by reducing the need of gas consumption. This could be accomplished by:

Provide tax incentives to encourage employers and employees to work at home, hence eliminating the need to compute to and from work (this also carries the benefits of reducing traffic jam, the need to build more roads and bridges, the need of day care facilities);

Subsidize the public transit system to encourage higher usage;

Encourage compost of organic wastes at home (hence eliminating the transportation of wastes) by charging home owners extra garbage fee if removal of yard trimmings is required;

Unlike the 2006 “Sherry Charlie” B.C. budget in which massive extra funding was allocated to hire more “child protection” social workers, this provincial budget did not increase funding to finance harmful government activities.